Search found 84 matches

by RandomWord
Tue Nov 19, 2019 1:36 pm
Forum: Investing - Theory, News & General
Topic: Are individual stocks back on the table now that we have $0 commissions?
Replies: 54
Views: 3789

Re: Are individual stocks back on the table now that we have $0 commissions?

Philosophically, I would enjoy being able to do this. It would be nice to actually own the shares, and be able to vote, instead of handing over control to a middleman to do it for me. As of Oct 31, 2019, Microsoft was 4.33% of VFIAX. If you had $1,000,000 in a roll-your-own S&P500 index, that means...
by RandomWord
Mon Nov 18, 2019 2:55 pm
Forum: Investing - Theory, News & General
Topic: Are individual stocks back on the table now that we have $0 commissions?
Replies: 54
Views: 3789

Re: Are individual stocks back on the table now that we have $0 commissions?

Philosophically, I would enjoy being able to do this. It would be nice to actually own the shares, and be able to vote, instead of handing over control to a middleman to do it for me. If it saves a few hundred bucks a year, that's just a bonus. I agree that it's likely too much work to do it right n...
by RandomWord
Thu Oct 10, 2019 10:26 pm
Forum: Investing - Theory, News & General
Topic: If Charles Schwab et al. drop commissions to zero, can we build our own index funds?
Replies: 68
Views: 7333

Re: If Charles Schwab et al. drop commissions to zero, can we build our own index funds?

You would have to trade almost every day to closely hew to the index. We always say the big benefit of an index fund is that it doesn’t have to trade to rebalance, everything just moves up and down in the market based on market cap. Why would it be any different for an individual? An index fund onl...
by RandomWord
Tue Oct 08, 2019 4:37 pm
Forum: Investing - Theory, News & General
Topic: HEDGEFUNDIE's excellent adventure Part II: The next journey
Replies: 1502
Views: 109039

Re: HEDGEFUNDIE's excellent adventure Part II: The next journey

Umh perhaps. I wouldn't have guessed so. Look my point is that instead of saying "it must be X because otherwise there's arbitrage", I would just calculate it (or use a tool; I can only imagine CME has one already). I've only really looked at S&P futures and pretty consistently I see them show clos...
by RandomWord
Tue Oct 08, 2019 4:35 pm
Forum: Investing - Theory, News & General
Topic: HEDGEFUNDIE's excellent adventure Part II: The next journey
Replies: 1502
Views: 109039

Re: HEDGEFUNDIE's excellent adventure Part II: The next journey

Umh perhaps. I wouldn't have guessed so. Look my point is that instead of saying "it must be X because otherwise there's arbitrage", I would just calculate it (or use a tool; I can only imagine CME has one already). I've only really looked at S&P futures and pretty consistently I see them show clos...
by RandomWord
Tue Oct 08, 2019 1:16 pm
Forum: Investing - Theory, News & General
Topic: HEDGEFUNDIE's excellent adventure Part II: The next journey
Replies: 1502
Views: 109039

Re: HEDGEFUNDIE's excellent adventure Part II: The next journey

Also.... this guy says that the implied repo rate in Treasury futures markets is SOFR.... not 3 month LIBOR (which it is for equity futures). https://seekingalpha.com/article/4250700-use-statistics-play-u-s-treasury-yield-curve Umh perhaps. I wouldn't have guessed so. Look my point is that instead ...
by RandomWord
Mon Oct 07, 2019 1:30 pm
Forum: Investing - Theory, News & General
Topic: HEDGEFUNDIE's excellent adventure Part II: The next journey
Replies: 1502
Views: 109039

Re: HEDGEFUNDIE's excellent adventure Part II: The next journey

Let's try my thought experiment. Let's forget about historical data. For a million and one reasons, it could lead you astray. Let's just start baby steps: 1) Do you truly believe rates follow a random walk? Like they're coin flips? As in "rates are as likely to go up than down"? Before I answer the...
by RandomWord
Wed Oct 02, 2019 12:10 pm
Forum: Investing - Theory, News & General
Topic: How to implement S&P Leap strategy?
Replies: 25
Views: 1945

Re: How to implement S&P Leap strategy?

What I AM saying is that if an option has a Delta of 1 and it cost you a third of the price of the underlying (strike price around 66% of underlying), that is a leveraged position of 3:1. Do you think this is incorrect? You have nailed the wrongness of your statement. Having a portfolio with a Delt...
by RandomWord
Tue Oct 01, 2019 10:40 pm
Forum: Investing - Theory, News & General
Topic: If all brokerages charged zero commission for trades, which brokerage would you pick?
Replies: 75
Views: 6823

Re: If all brokerages charged zero commission for trades, which brokerage would you pick?

Its the race to zero Why stop at zero? Maybe some broker will start paying us for our trades. Actually, if I amortize the $6k in new account bonus money TDA has paid me since 2015 against the few ETF trades I pay for each year, it seems that TDA is already paying me for my trades. Based on my exper...
by RandomWord
Tue Oct 01, 2019 3:44 pm
Forum: Investing - Theory, News & General
Topic: If all brokerages charged zero commission for trades, which brokerage would you pick?
Replies: 75
Views: 6823

Re: If all brokerages charged zero commission for trades, which brokerage would you pick?

FrugalConservative wrote:
Tue Oct 01, 2019 3:32 pm
Its the race to zero
Why stop at zero? Maybe some broker will start paying us for our trades.
by RandomWord
Mon Sep 30, 2019 11:34 am
Forum: Investing - Theory, News & General
Topic: Interactive Brokers (Best Kept Secret)
Replies: 178
Views: 52016

Re: Interactive Brokers (Best Kept Secret)

IB execution quality ( which probably matters more than commission but hard to measure) is said to be better than any other retail brokers. IB is connected to more liquidity pools and use smart order routing system meaning better chance of orders getting executed at favorable price. IB publishes a ...
by RandomWord
Sat Sep 28, 2019 7:22 pm
Forum: Investing - Theory, News & General
Topic: Interactive Brokers (Best Kept Secret)
Replies: 178
Views: 52016

Re: Interactive Brokers (Best Kept Secret)

IB execution quality ( which probably matters more than commission but hard to measure) is said to be better than any other retail brokers. IB is connected to more liquidity pools and use smart order routing system meaning better chance of orders getting executed at favorable price. IB publishes a ...
by RandomWord
Tue Sep 24, 2019 12:52 pm
Forum: Investing - Theory, News & General
Topic: A gentle alternative to HEDGEFUNDIE's excellent adventure with 2-Year Treasury Futures
Replies: 91
Views: 9216

Re: A gentle alternative to HEDGEFUNDIE's excellent adventure with 2-Year Treasury Futures

But I also think it's important to keep in mind the scale. The leverage on these things is so large that it's easy to lose track of the big picture. I don't think $50 per year or whatever on a $200,000 notional value is worth worrying about it. Now, if there's some reason why eurodollars should del...
by RandomWord
Mon Sep 23, 2019 10:35 pm
Forum: Investing - Theory, News & General
Topic: A gentle alternative to HEDGEFUNDIE's excellent adventure with 2-Year Treasury Futures
Replies: 91
Views: 9216

Re: A gentle alternative to HEDGEFUNDIE's excellent adventure with 2-Year Treasury Futures

Can you go into detail on the cost savings for eurodollars vs treasury futures? Because it doesn't seem like it should be very much. Assuming you're trading the front contract, you should be able to pay just one tick on the spread, so 1/256 * 2000, or slightly less than $8. Call it $10 per contract...
by RandomWord
Mon Sep 23, 2019 5:10 pm
Forum: Investing - Theory, News & General
Topic: A gentle alternative to HEDGEFUNDIE's excellent adventure with 2-Year Treasury Futures
Replies: 91
Views: 9216

Re: A gentle alternative to HEDGEFUNDIE's excellent adventure with 2-Year Treasury Futures

I held a portfolio quite similar to this for the past two years, but toned it down a couple of weeks ago because I was getting worried. Over those two years my bond positions contributed about 6% growth to my total account value, so I disagree with those people who think the proposed bond position ...
by RandomWord
Sat Sep 21, 2019 10:57 pm
Forum: Investing - Theory, News & General
Topic: A gentle alternative to HEDGEFUNDIE's excellent adventure with 2-Year Treasury Futures
Replies: 91
Views: 9216

Re: A gentle alternative to HEDGEFUNDIE's excellent adventure with 2-Year Treasury Futures

HEDGEFUNDIE has well documented his approach for a risk parity strategy using 3x leveraged ETFs. Some members found the approach interesting and jumped in while others pointed out the risks of leveraged investing. In this post, I describe a gentle alternative to HEDGEFUNDIE's 3x leveraged ETFs as d...
by RandomWord
Sat Sep 21, 2019 4:37 pm
Forum: Investing - Theory, News & General
Topic: A gentle alternative to HEDGEFUNDIE's excellent adventure with 2-Year Treasury Futures
Replies: 91
Views: 9216

Re: A gentle alternative to HEDGEFUNDIE's excellent adventure with 2-Year Treasury Futures

Anyone interested in this should probably read through this thread: https://www.bogleheads.org/forum/viewtopic.php?t=143037 Lots of good info there. My experience from running this strategy for the past few years: -Futures are hard to understand. They use a lot of strange technical jargon ('backward...
by RandomWord
Wed Sep 18, 2019 11:35 am
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 632
Views: 46698

Re: Lifecycle Investing - Leveraging when young

So out of curiosity, who else is using temporal diversification in their investments to some degree? By that I mean taking future savings contributions into account somewhat to guide how much to invest in risky assets today. Anyone? I don't have any formal plan like what you're doing or what that b...
by RandomWord
Tue Sep 17, 2019 3:56 pm
Forum: Investing - Theory, News & General
Topic: Buying the Dow as a super-low-cost index strategy?
Replies: 36
Views: 3272

Re: Buying the Dow as a super-low-cost index strategy?

If you're that worried about 4 basis points with a $4 million portfolio, then just buy Fidelity's ZERO fund FZROX with a 0% ER. I have access to a Blackrock S&P 500 fund in my 457 plan with a .003% ER, 3/10 of one basis point. I see no reason at all to 'create your own fund'. There are certainly mo...
by RandomWord
Tue Sep 17, 2019 2:54 pm
Forum: Investing - Theory, News & General
Topic: Buying the Dow as a super-low-cost index strategy?
Replies: 36
Views: 3272

Re: Buying the Dow as a super-low-cost index strategy?

So you want to trade the tiny expense ratio of a broadly-diversified index fund for 30 individual stock trade fees every time you want to buy or sell? Sounds like an excellent plan! 0.04% x $4000 = $1.60 30 x $4.95 = $148.50 $148.50 / $1.60 = 93 years of expenses That's just an issue of scale, thou...
by RandomWord
Tue Sep 17, 2019 12:10 pm
Forum: Investing - Theory, News & General
Topic: Buying the Dow as a super-low-cost index strategy?
Replies: 36
Views: 3272

Re: Buying the Dow as a super-low-cost index strategy?

So you want to trade the tiny expense ratio of a broadly-diversified index fund for 30 individual stock trade fees every time you want to buy or sell? Sounds like an excellent plan! 0.04% x $4000 = $1.60 30 x $4.95 = $148.50 $148.50 / $1.60 = 93 years of expenses That's just an issue of scale, thou...
by RandomWord
Mon Sep 16, 2019 11:45 pm
Forum: Investing - Theory, News & General
Topic: Buying the Dow as a super-low-cost index strategy?
Replies: 36
Views: 3272

Re: Buying the Dow as a super-low-cost index strategy?

So you want to trade the tiny expense ratio of a broadly-diversified index fund for 30 individual stock trade fees every time you want to buy or sell? Sounds like an excellent plan! 0.04% x $4000 = $1.60 30 x $4.95 = $148.50 $148.50 / $1.60 = 93 years of expenses That's just an issue of scale, thou...
by RandomWord
Mon Sep 16, 2019 11:43 pm
Forum: Investing - Theory, News & General
Topic: Buying the Dow as a super-low-cost index strategy?
Replies: 36
Views: 3272

Re: Buying the Dow as a super-low-cost index strategy?

So you want to trade the tiny expense ratio of a broadly-diversified index fund for 30 individual stock trade fees every time you want to buy or sell? Sounds like an excellent plan! 0.04% x $4000 = $1.60 30 x $4.95 = $148.50 $148.50 / $1.60 = 93 years of expenses That's just an issue of scale, thou...
by RandomWord
Mon Sep 16, 2019 10:49 pm
Forum: Investing - Theory, News & General
Topic: Buying the Dow as a super-low-cost index strategy?
Replies: 36
Views: 3272

Re: Buying the Dow as a super-low-cost index strategy?

So you want to trade the tiny expense ratio of a broadly-diversified index fund for 30 individual stock trade fees every time you want to buy or sell? Sounds like an excellent plan! 0.04% x $4000 = $1.60 30 x $4.95 = $148.50 $148.50 / $1.60 = 93 years of expenses That's just an issue of scale, thou...
by RandomWord
Mon Sep 16, 2019 12:10 pm
Forum: Investing - Theory, News & General
Topic: Buying the Dow as a super-low-cost index strategy?
Replies: 36
Views: 3272

Re: Buying the Dow as a super-low-cost index strategy?

So you want to trade the tiny expense ratio of a broadly-diversified index fund for 30 individual stock trade fees every time you want to buy or sell? Sounds like an excellent plan! 0.04% x $4000 = $1.60 30 x $4.95 = $148.50 $148.50 / $1.60 = 93 years of expenses That's just an issue of scale, thou...
by RandomWord
Mon Sep 16, 2019 11:25 am
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 632
Views: 46698

Re: Lifecycle Investing - Leveraging when young

I believe TDA does something where they allow a negative cash balance (charging interest of course) and will keep your futures position open... if you have collateral in equity funds. So they apparently won't kick you out of the position. I believe IB immediately closes your future position (even i...
by RandomWord
Sun Sep 15, 2019 10:50 pm
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 632
Views: 46698

Re: Lifecycle Investing - Leveraging when young

I believe TDA does something where they allow a negative cash balance (charging interest of course) and will keep your futures position open... if you have collateral in equity funds. So they apparently won't kick you out of the position. I believe IB immediately closes your future position (even i...
by RandomWord
Thu Sep 12, 2019 1:22 pm
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 632
Views: 46698

Re: Lifecycle Investing - Leveraging when young

These past few weeks are an excellent example of why I make a big deal of maintaining exposure instead of constant leverage. As the market dipped, my leverage increased slightly. A pay period came by and I was able to erase some of those losses, effectively buying right at the market bottom (~28400...
by RandomWord
Thu Sep 12, 2019 1:19 pm
Forum: Investing - Theory, News & General
Topic: Understanding using treasury futures for leverage to implement risk parity
Replies: 161
Views: 13831

Re: Understanding using treasury futures for leverage to implement risk parity

Did you ever try simulating them with quandl's data on reference futures: https://www.quandl.com/data/SRF-Reference-Futures?keyword=Treasury ? Seems like that would be a more accurate representation of what really happened. It might be a bit of a pain to code though, since there's so many series th...
by RandomWord
Wed Sep 11, 2019 5:21 pm
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 632
Views: 46698

Re: Lifecycle Investing - Leveraging when young

These past few weeks are an excellent example of why I make a big deal of maintaining exposure instead of constant leverage. As the market dipped, my leverage increased slightly. A pay period came by and I was able to erase some of those losses, effectively buying right at the market bottom (~28400...
by RandomWord
Wed Sep 11, 2019 4:30 pm
Forum: Investing - Theory, News & General
Topic: Day Trading for a Living?
Replies: 44
Views: 4127

Re: Day Trading for a Living?

I'm surprised that the Brazilian equity futures market is third in terms of volume in the world. How does that work? I would have thought they'd be way further down. I wonder if Brazil is just a hot spot for day traders.
by RandomWord
Tue Sep 10, 2019 3:58 pm
Forum: Investing - Theory, News & General
Topic: Understanding using treasury futures for leverage to implement risk parity
Replies: 161
Views: 13831

Re: Understanding using treasury futures for leverage to implement risk parity

I read through this thread and decided to test the theory using quandl data ( https://www.quandl.com/databases/SCF/documentation ). I used the backwards ratio adjusted open interest switch method with CME TU continuous futures( CME_TU1_OR). Did you ever try simulating them with quandl's data on ref...
by RandomWord
Tue Sep 10, 2019 12:58 pm
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 632
Views: 46698

Re: Lifecycle Investing - Leveraging when young

Is there any way to get historical data on options prices? Doesn't even have to be too far back, just from a few years ago when the yield curve wasn't inverted. I'd like to see whether comeinvest is right that the lower apparently cost of options leverage right now is due to duration and the yield c...
by RandomWord
Mon Sep 09, 2019 1:02 pm
Forum: Investing - Theory, News & General
Topic: Understanding using treasury futures for leverage to implement risk parity
Replies: 161
Views: 13831

Re: Understanding using treasury futures for leverage to implement risk parity

I read through this thread and decided to test the theory using quandl data ( https://www.quandl.com/databases/SCF/documentation ). I used the backwards ratio adjusted open interest switch method with CME TU continuous futures( CME_TU1_OR). I found that open interest switch vs. first day of expire ...
by RandomWord
Mon Sep 09, 2019 12:49 pm
Forum: Investing - Theory, News & General
Topic: 3X leveraged ETFs - where are the gains coming from?
Replies: 40
Views: 3265

Re: 3X leveraged ETFs - where are the gains coming from?

Sorry but I was not looking for the explanation on why portfolio return is good (falling rate and bullish market), but when futures appreciates 3X, who pays for the appreciation in the market. A futures contract always has a long side and a short side, so if you are long 3 contracts someone else mu...
by RandomWord
Wed Sep 04, 2019 3:26 pm
Forum: Investing - Theory, News & General
Topic: Uncle Fred’s Second Coin – The Case for Leveraged Bonds
Replies: 126
Views: 7663

Re: Uncle Fred’s Second Coin – The Case for Leveraged Bonds

I believe Treasury futures basically get the overnight repo rate....so more or less the Fed Funds rate, no? Futures use the LIBOR, which historically is slightly above the fed fund rate. I believe the 3-month T-bill can also be used as an approximation if you want data going further back in time. C...
by RandomWord
Tue Sep 03, 2019 12:19 pm
Forum: Investing - Theory, News & General
Topic: Uncle Fred’s Second Coin – The Case for Leveraged Bonds
Replies: 126
Views: 7663

Re: Uncle Fred’s Second Coin – The Case for Leveraged Bonds

I'm confused why you are using IEF over SHY.... when your OP advocates for leveraging 2 yr Treasury? So I figured I would buy a long-term call today on SHY to see what kind of fill I could get. Current price of the underlying is 85.07. I bought the 1/15/21 contract (504 days) at the 81 strike. I wa...
by RandomWord
Mon Sep 02, 2019 9:06 pm
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 632
Views: 46698

Re: Lifecycle Investing - Leveraging when young

Thanks for the answer. This is quite interesting, since this rate is even lower than the rate for the E-mini S&P rate, which hovers around the 3 months Libor, which is at the moment is 2,1%! See also https://www.cmegroup.com/trading/equity-index/report-a-cost-comparison-of-futures-and-etfs.html And...
by RandomWord
Thu Aug 29, 2019 4:15 pm
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 632
Views: 46698

Re: Lifecycle Investing - Leveraging when young

In this scenario, I'd trust the puts, since the bid/offer spread is much tighter. There's also potential issues with early exercise on deep-in-the-money calls that would cause put-call parity to break down and perhaps throw off the Greek calculations. Fair enough. Any thoughts on my current strateg...
by RandomWord
Thu Aug 29, 2019 3:14 pm
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 632
Views: 46698

Re: Lifecycle Investing - Leveraging when young

IIRC, exercised option costs are rolled into the purchased asset's cost basis. Unsure about this, but since the asset purchase would negate the option, it seems like the click would start all over again. If the options are rolled, the worthless one would be a loss, the valuable one would be cap gai...
by RandomWord
Thu Aug 29, 2019 12:23 pm
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 632
Views: 46698

Re: Lifecycle Investing - Leveraging when young

The values of the Dec 2021 puts suggest there is a reasonable likelihood we see sub-215 SPY. Oh yeah you're right. Kinda significant too. Around 20- 25% perhaps. How can there be such an inconsistency in the call and puts like that? Do you just use whichever is more conservative? In this scenario, ...
by RandomWord
Wed Aug 28, 2019 4:36 pm
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 632
Views: 46698

Re: Lifecycle Investing - Leveraging when young

If it's cheaper than buying a future, why hasn't it been arbitraged away? Is there additional risk involved? Longer time factor? Additional transaction costs? Is it actually cheaper? My impression is that the main benefit of options over futures is the better tax treatment, if you're holding for ov...
by RandomWord
Wed Aug 28, 2019 12:17 pm
Forum: Investing - Theory, News & General
Topic: Brokerages for Futures Trading in IRA?
Replies: 20
Views: 1463

Re: Brokerages for Futures Trading in IRA?

There was a commotion a few years ago when IB suddenly and without warning closed all the futures that people were trading in IRAs. I have a hard time trusting them again after that. 300% futures margin requirement is also ridiculous (even if they don't margin call you, that represents a significant...
by RandomWord
Tue Aug 27, 2019 1:00 pm
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 632
Views: 46698

Re: Lifecycle Investing - Leveraging when young

After much lurking, I've decided to go in this strategy. Application was approved. Bought one 288 strike call and sold the equivalent put. Expiration is Dec 2021. I entered for a small credit. I will see how that goes before adding any more. Thank you for the information 305. Very cool, you're welc...
by RandomWord
Mon Aug 26, 2019 2:53 pm
Forum: Investing - Theory, News & General
Topic: Uncle Fred’s Second Coin – The Case for Leveraged Bonds
Replies: 126
Views: 7663

Re: Uncle Fred’s Second Coin – The Case for Leveraged Bonds

And what does the leverage cost? For those of us who are do it yourself retail investors, I have to presume the cost will be substantial - maybe exceeding 100% of the total return on the leveraged asset in some cases. It depends which products you use. I'm also a DIY retail investor and I'm current...
by RandomWord
Mon Aug 26, 2019 2:47 pm
Forum: Investing - Theory, News & General
Topic: Uncle Fred’s Second Coin – The Case for Leveraged Bonds
Replies: 126
Views: 7663

Re: Uncle Fred’s Second Coin – The Case for Leveraged Bonds

And what does the leverage cost? For those of us who are do it yourself retail investors, I have to presume the cost will be substantial - maybe exceeding 100% of the total return on the leveraged asset in some cases. It depends which products you use. I'm also a DIY retail investor and I'm current...
by RandomWord
Mon Aug 26, 2019 2:00 pm
Forum: Investing - Theory, News & General
Topic: Uncle Fred’s Second Coin – The Case for Leveraged Bonds
Replies: 126
Views: 7663

Re: Uncle Fred’s Second Coin – The Case for Leveraged Bonds

And what does the leverage cost? For those of us who are do it yourself retail investors, I have to presume the cost will be substantial - maybe exceeding 100% of the total return on the leveraged asset in some cases. It depends which products you use. I'm also a DIY retail investor and I'm current...
by RandomWord
Fri Aug 23, 2019 1:41 pm
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 632
Views: 46698

Re: Lifecycle Investing - Leveraging when young

Yeah you pay margin rates, but you only have to borrow enough to meet the collateral for the futures, which is quite small. I think it's 2% for an S&P e-mini, so you'd be paying margin rate (about 3%) on 2% of your total, for an overall rate of 0.06%. You can stay fully invested in regular stocks, ...
by RandomWord
Thu Aug 22, 2019 4:23 pm
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 632
Views: 46698

Re: Lifecycle Investing - Leveraging when young

305pelusa wrote:
Wed Aug 21, 2019 10:00 am


This is equivalent to borrowing at ~1.77% for the next 2.5 years.
Also, a basic question. How did you calculate this borrowing cost? And is that fixed, or is that going to change if interest rates change?
by RandomWord
Thu Aug 22, 2019 3:05 pm
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 632
Views: 46698

Re: Lifecycle Investing - Leveraging when young

Could you explain why options are better than futures here? Futures require settled cash as collateral. As I came to find out, Schwab pays you basically nothing for that cash (0.3%). IB pays you 1.63%, which is still significantly lower from a MM or high yield savings (not to mention all of the add...